These 'hated' stocks stand to do very well: Jim Grant

Dissecting the market's valuation, with Jim Grant of Grant's Interest Rate Observer. Grant says the central bank imposed interest rates are the source of global financial instability now and in the future.

Despite the conflict in Ukraine and the sanctions imposed on Russia for supporting insurgents, Jim Grant is bullish on Russian stocks.

"These values are extraordinary and to the extent that saner, cooler heads prevail in the Ukraine- Russia dispute, these stocks stand to do very well," said the founder and editor of Grant's Interest Rate Observer in an interview with CNBC's "Closing Bell."

"In buying them, one is actually on the side of peace and prosperity and rationalism."

Many of the stocks are trading at 3, 4 or 5 times earnings, Grant noted.

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James Grant, founder and editor of Grant's Interest Rate Observer.

U.S. and European leaders agreed on Monday to impose wider sanctions on financial, defense and energy sectors in Russia. That may make many investors uncomfortable, but Grant said most trades that are any good often make people uncomfortable.

"The risks are self-evident and frightening, but sometimes the worst does not happen. Sometimes it does. That's the gamble. This is truly a gamble," he said.

Another contrary investment he has his eye on is mining stocks, which are "almost as thoroughly hated as Russia." He thinks they are a sound inoculation against the Federal Reserve's monetary policy, of which he's been a critic.